BVI company sues Bank Medici over investments into Ponzi scheme

BVI-registered company Repex Ventures SA filed a lawsuit in Manhattan federal court against Bank Medici AG, an Austrian private bank that was taken over by regulators. The BVI company invested $700,000 in Herald (LUX) U.S. Absolute Return Fund, which was controlled by the Austrian offshore bank, and now Repex alleges Medici of misleading investors by not disclosing that it was pouring money into funds run by Bernard Madoff – the money manager arrested last month for $50 billion Ponzi scheme. According to the complaint, 100% of the Herald Funds were transferred to Madoff without informing investors.

Bank Medici, which is 25% owned by UniCredit SpA, is the European bank with the largest potential losses related to the Madoff investments. Its clients invested $3.2 billion in funds run by the alleged manager. Last week, after the offshore bank was taken under control by Austrian regulator, the new management board was appointed.

The lawsuit of the BVI company against Bank Medici, which now seeks class action, or group status, is the latest to seek damages from the funds that invested in Madoff’s scheme.

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